BOLAR EXEMPTION Under Indian Patent Law

BOLAR EXEMPTION under Indian Patent Law
By Ms. Parnil Yodha
ABSTRACT
The developing countries need a certain amount of protection against

patenting, particularly, in the pharmaceutical sector so as to ensure
adequate public healthcare for their populace. This paper tries to
delve into the meaning and need of the Bolar exemption for the
developing countries, and find out if a Bolar exemption exists under
the Indian Patent law.
INTRODUCTION
“The main way that developing countries can use IPRs to address
public health issues is to ensure that their legislation provides for
appropriate standards and practices. What is appropriate will vary
according to country circumstances and level of development.
However, specific to pharmaceuticals, most developing countries
should as the least minimum take up the possibility allowed by
TRIPS of excluding diagnostics, therapeutic and surgical methods for
treatments of humans or animals from patentability, as well as new
uses of known products (which, in essence, are equivalent to
therapeutic methods).”1
1
Report of the Commission on IPR “Integrating intellectual property rights and development
policy”; London, September 2002
BOLAR EXEMPTION: Need
The developing countries need a certain amount of protection against

patenting, particularly, in the pharmaceutical sector so as to ensure
public healthcare for their populace. Article 30 of the Trade-Related
Aspects of Intellectual Property Rights (TRIPS) allows limited
exemption to the rights of the patentee with a rider. The rider is that
such exemption should not unreasonably interfere and prejudice the
legitimate interests of the patentee. However, at the same time, the
legitimate interests of third parties must also be taken care of 2. This
exception is of utmost importance for the developing countries that
lack well-evolved research capabilities in a field as crucial as
medicine.
Most developing countries lack resources to develop the state of the

art therapeutic, diagnostic and surgical methods. Consequently, it is
advisable for the developing countries to enact an appropriate law to
allow the generic drug manufacturers to produce the patented drug in
tiny quantities in order to obtain to prepare for the approval of the
drug regulatory authority post the expiry of the patent. 3 This
exception is popularly referred to Bolar exception (or early working
exception).
2
Report on ‘Steps to be taken by Government of India in the context of Data Protection
provisions of Article 39.3 of Trips Agreement’, 31 st May 2007, Satwant Reddy Gurdial Sandhu,
Government of India
3
BOLAR EXEMPTION: Meaning
In 1983, a case called Roche Products v. Bolar Pharmaceutical 4

happened. The matter in issue was, Bolar Pharmaceuticals desired to
perform studies during the existence of a patent, which were required
to be conducted prior to producing generic versions of any drug (as
per the US Regulatory Authorities) after expiry of that patent, and in
this case, the drug was the plaintiff’s patented API Flurazepam. The
said drug was used in manufacturing of sleeping pills which were, in
turn, sold by the plaintiff under the brand name ‘Dalmane’. The
plaintiff alleged that the use of its patented drug for producing a
generic version was an infringement of its patent. The Court of
Appeals for the Federal Circuit held : “The competitor’s use of
patented ingredient to perform test necessary for it to obtain approval
of the FDA for its version of the sleeping pill once the patent expired
was a prohibit use”. In response, a law called ‘the Drug Price
Competition and Patent Term Restoration Act of 1984’ was enacted
to overturn the said judgment. “The said law carved out an exception
to the patentee’s rights in respect of use of the patentee’s product for
development and experimental use and this exception is generally
referred to in the US as the Bolar Exception”.5
A Bolar Exemption permits preparatory action by non-patentees

through compulsory licensing during the life of the patent for use
4
733 F.2d 858 (Fed. Cir. 1984)
5
Bayer Corporation vs. Union of India MANU/DE/2961/2014; Manupatra.org
after the expiry of the protection for certain specified public interest
purposes.6
INDIAN LAW
At its onset, the Indian Patent Act 1970 did not allow product patents
in respect of medicines, though the process patents were granted vis-
à-vis drugs and medicines because India needed to undertake
manufacturing of the patented drugs to make them available to its
people at low cost back then, though by using a different process.
Thereupon, India had to agree to provide patent protection to products
by 2005 when it signed the TRIPS Agreement in 1995.7 The 1970 Act
was amended in 2002 and 2004 to bring it in conformity with the
TRIPS.
Sections 82 to 94 covered under the Chapter XVI of the Indian Patent

Act, 1970 state the grounds upon which compulsory licenses can be
granted to secure public interest, especially, to protect public health
and nutrition.
The Government has been empowered under section 47 of the Indian

Patents Act, 1970 to not just use and make, but also import drugs or
medicine “for the purpose merely of its own use or for distribution in
any dispensary, hospital or other medical institution” .8
6
Economic Survey of India (2004-05)
7
8
Section 107A (a) of the Indian Patents Act, 1970 was inserted in
2002. Then, it read as:
“any act of making, constructing, using or selling a patented

invention solely for uses reasonable relating to the development and
submission of information required under any law for the time being
in force, in India, or in a country other than India, that regulates the
manufacture, construction, use or sale in any product.”
In 2005, Section 107A (a) of the Act was amended and the import of
a patented invention was also allowed for the purpose of this
provision. Now, the section reads:
“any act of making, constructing, using, selling or importing a

patented invention solely for uses reasonably relating to the
development and submission of information required under any law
for the time being in force, in India, or in a country, other than India,
that regulates the manufacture, construction, use, sale or import of
any product.” 9
However, it still does not mention the word ‘export’.
In Bayer Corporation vs. Union of India10, the issue was: “Whether

the sale of a patented invention by a compulsory licensee which was
required for development and submission of information under the
law of any country (other than India) that regulated the manufacture
or sale of any product came within the section 107A(a) of the Indian
9
http://IndianKanoon.org
10
MANU/DE/2961/2014
Patents Act, 1970”. The petitioner had been conferred with a patent
for a drug titled ‘Carboxyaryl Substituted Diphenyl Ureas’ for a
period of 20 years. ‘Sorafenib tosylate’ was a compound made of this,
marketed under the Brand name ‘Nexavar’. Nexavar was a life
extending drug meant for the patients suffering from kidney and liver
cancer in advanced stages.
A compulsory license to manufacture pharmaceutical products which

were covered under the petitioner’s patent was granted to another
company “solely for the purpose of making using, offering for sale
and selling the drug covered by the patent for the purpose of treating
HCC and RCC in humans within the territory of India”. The said
licensee was making a drug ‘Sorafenat’ (brand name) under the said
compulsory license. However, under the terms of the compulsory
license, it was not permitted the export of the same. The said licensee
sought permission to export 1 kg of the Active Pharmaceutical
Ingredient (API) Sorafenib so as to conduct drug trials to a Chinese
Pharmaceutical Company.
The petitioner alleged that the said licensee was exporting its patented
drug into another country, and thereby, it was infringing its patent.
The Delhi High Court observed:
“A purposive interpretation of Section 107A of the Act is

attempted, it would have to be in favour of permitting export.
The purpose for excluding development activities and uses for
regulatory approvals is to ensure that the exploitation of
patented invention is not restricted beyond the period or sphere
of exclusivity granted to the patentee.
In the world as is now shaping up, national borders offer only
limited barriers to trade. As such, confining the exclusion of
section 107A to sales within India would not aid the object of
the said exclusion.”
The Delhi High Court held that “the export of Sorafenat for carrying
out studies required for obtaining regulatory approvals would fall
within the exception under Section 107A of the Act”.
It can be said that, by virtue of the present judgment, the Delhi High
Court indirectly allowed export of the patented drug for conducting
research under the Bolar exemption for use after the expiry of the
patent.
CONCLUSION
Most developing countries do not have well-evolved research
capabilities, and have severe public health concerns. The flexibility in
patenting provided by the TRIPS under its article 30 must be utilised
by the developing countries to address their public healthcare and
related research concerns. Since most of the developing countries lack
resources for conducting clinical trials required for obtaining
regulatory approvals, it shall be beneficial for them if they allow the
drugs manufactured under the Bolar exemption on the basis of the
original data obtained by patentee in his research. 11 India has
successfully enacted a legal provision based on the said article of the
TRIPS to meet its affordable healthcare needs.
The Indian courts have been active in invoking the Bolar exemption
provision, usually, to protect the interests of the poor who cannot
afford the branded drugs under any circumstance, but have as much
right to healthcare as the rich have. However, can it be invoked for a
purpose other than public health also? Going by the language of the
section 107A(a) of the Act, it is manifest that the said clause covers
all uses “reasonably related to development”. As of now, there is no
judgment on this point. Thus, what all constitutes “ use reasonably
related to development” may get answered only in times to come.
11

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BOLAR EXEMPTION under Indian Patent Law

By Ms. Parnil Yodha

The developing countries need a certain amount of protection against

The developing countries need a certain amount of protection against

Most developing countries lack resources to develop the state of the

In 1983, a case called Roche Products v. Bolar Pharmaceutical 4

A Bolar Exemption permits preparatory action by non-patentees

Sections 82 to 94 covered under the Chapter XVI of the Indian Patent

The Government has been empowered under section 47 of the Indian

“any act of making, constructing, using or selling a patented

“any act of making, constructing, using, selling or importing a

However, it still does not mention the word ‘export’.

In Bayer Corporation vs. Union of India10, the issue was: “Whether

A compulsory license to manufacture pharmaceutical products which

The Delhi High Court observed:

“A purposive interpretation of Section 107A of the Act is

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